In the latest edition of Encore, the Journal Report group’s issue dedicated to retirement, the cover story explores the mental mistakes we make with retirement spending. What’s particularly interesting is not that we make avoidable mistakes, but rather that mistakes made in retirement are often the byproduct of pre-retirement habits.
Imagine spending a lifetime acquiring habits that offer the promise of a longer, happier and more fulfilling life. Then imagine that to have that fulfilling life, you suddenly must abandon all those habits.
Not easy, is it? But that’s what happens when people go from work to retirement, from saving money to spending it. Too often, the same personality traits that facilitate saving for retirement become impediments when it is time to spend that money. The mental tricks we employ while working become mental mistakes when we move into the next phase of our lives.
The result isn’t merely a nuisance. It can lead to a much less satisfying retirement—one in which people spend too little money and spend it on the wrong things, as well as take on too much investment risk. It can greatly reduce the happiness of later life, a time when many people have the time and money (and wisdom) to enjoy their lives in a way they never could before.
Read on to explore how to identify and beat those habits. And if you want more reading on issues related to retirement and saving, check out these other Encore highlights:
- Is There Really a Retirement Savings Crisis?
- When Enough Doesn’t Have to Mean More
- It May Be Time for Older Investors to Tweak Their Portfolios
- How Entrepreneurs Can Use IRAs to Finance Startups
Below, some of the best analysis and insight from WSJ writers and columnists, and occasionally beyond, on investing, the wealth-management business and more.
TALKING POINTS
Tax talk. President Trump has ordered aides to draft a tax plan that slashes the corporate tax rate to 15%, even if that means a loss of revenue and exacerbating the plan’s procedural and partisan hurdles. Mr. Trump told his team to “get it done,” in time to release a plan by Wednesday.
Valuation shortfall. Officials working on taking Saudi Arabian Oil Co. public have struggled to come up with a scenario under which the state-owned company is worth more than $1.5 trillion, at least $500 billion less than the government previously suggested.
Monday’s markets. Global markets rallied after results from the French presidential elections rekindled investors’ appetite for risk. The Dow Jones Industrial Average rose 216 points, or 1.1%, to 20764. The S&P 500 jumped 1.1%, while the Nasdaq Composite climbed 1.2% to 5984, a record for the index.
PLANNING AND INVESTING
Streetwise. Monday’s market response reflects the true terror that had been priced in before Sunday’s French election, more than it indicates undervalued stocks, writes columnist James Mackintosh.
Watching Your Wealth podcast. CIO of Parametric Paul Bouchey talks with WSJ Wealth Adviser’s Veronica Dagher on why losses can be a good thing for your portfolio and how to take advantage of them for your benefit.
Subscribe to the Watching Your Wealth podcast at wsj.com or on iTunes. And find the full archives of Watching Your Wealth here.
BUSINESS AND PRACTICE
Adviser Voices. Evan Schmidt, vice president of Schmidt Financial Group, says technology professionals and entrepreneurs can be rewarding clients for financial advisers if they adapt to their demanding ways.
Adviser Voices, ICYMI. Many female clients switch advisers when they become widowed. Barbara Shapiro, president of HMS Financial Group, doesn’t think this is because widows suddenly want to seek new counsel on their finances. Rather, she think it’s because financial advisers aren’t well-versed in communicating with grieving clients.
ADVISER CALENDAR
– Morningstar Investment Conference / Chicago, April 26-28
– Advicent Innovation Summit / New York, May 18
– NAPFA Spring National Conference / Bellevue, Wash., May 16-19
– Fi360 Conference / Nashville, Tenn., May 21-23
– CFA Institute’s 70th Annual Conference / Philadelphia, May 21-24
– FPA NorCalConference / San Francisco, May 30-31
– AICPA Engage 2017 / Las Vegas, June 12-15
– FPA NexGen Gathering / Chicago, June 23-25
– In|Vest 2017 / New York, July 11-12
– RIIA Summer Conference 2017 / Salem, Mass., July 17-18
– XYPN17 And FinTech Competition / Dallas, Aug. 28-31
– Insider’s Forum 2017 / Nashville, Tenn., Sept. 6-8
– ADISA 2017 Annual Conference / Las Vegas, Oct. 23-25
– IMCA Private Wealth Advisor (PWA) 2017 / Chicago, Oct. 16-17
– FPA Minnesota 2017 Annual Symposium / Minneapolis, Oct. 16-17
– FinCon 2017 / Dallas, Oct. 25-28
– The SRI Conference / San Diego, Nov. 1-3
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The Wealth Adviser briefing covers topics of special interest to wealth managers, financial planners and other advisers. It’s delivered to subscribers by email each workday morning; you can sign up for email delivery here: http://on.wsj.com/WealthAdviserSignup. Please send tips, suggestions or other comments to michael.wursthorn@wsj.com or Wealth Editor Brian Hershberg at brian.hershberg@wsj.com.
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April 25, 2017 at 03:32PM
from Brian Hershberg
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